Irell & Manella LLP

Published June 2011

2011 Vault Ranking: 37

Overview

Irell & Manella is among the elite of Southern California. Irell is a full service firm, but is has earned its reputation primarily for being an elite intellectual property firm. Despite being one of the smaller top Vault-ranked firms, it still is ranked number two overall in intellectual property litigation. Many of its clients are California based, but the firm has national and international reach in its areas of expertise.

Irell was founded in Los Angeles in 1941 by Lawrence E. Irell and Arthur Manella, originally as a tax oriented firm that counted such Hollywood names as Orson Welles and Doris Day among its clients. Over time however, the practice shifted to cover other needs of their entertainment industry clients, leading to specialization in intellectual property law, which in turn led to other related practice areas. The firm added a wide variety of litigation practice areas to capitalize on their experience in the courtroom, and added more transactional practices to cater to their corporate clients.

The firm has since grown to over two hundred attorneys, but has stayed true to its roots. It still maintains a strong tax practice, and it is still heavily involved in the entertainment industry. Recent clients have included Peter Jackson, Mark Burnett, and Stevie Wonder. Even though the bulk of the firm’s work is from intellectual property, their clients still include such entertainment giants as ABC, Pixar, Universal Music Group, Warner Bros., Disney, Lucasfilm, and numerous others.

Irell has weathered the economic storms very well. The firm has had no mass layoffs, nor have there been any salary freezes. On the contrary, in 2009, the most recent year of reporting, revenue increased ten percent to $253 million. Profits per partner jumped a staggering twenty seven percent to hit $2.49 million. The firm has been very successful with their approach, and has shown no desire to start opening franchise offices all over the country, or even outside of Southern California. The firm is content to stay relatively small, and focus on simply being the best at what they do.

Practice Areas

Irell is a general practice firm in theory. It boasts a strong litigation group with strengths in entertainment, securities, and white-collar crime. Its corporate team is well known for their tax work, and has a very capable transaction group, and it is rounded out by a focus in intellectual property. However in reality, while the firm is capable of many things, it is very, very good at one of them.

Half of the attorneys at Irell practice intellectual property law in some fashion. The practice is divided into three groups: patent, copyright, and trademark. Each group handles both transactional and litigation matters. Though the firm has historically held strong ties with the entertainment industry, the intellectual property group has numerous biotech, telecom, and electronics corporations among its clients. It has represented the likes of Intel, Skype, TiVo, Hewlett-Packard, and more. In fact in 1986, Irell was the counsel for the defendant in the first patent litigation ever involving software.

Outside of the intellectual property group, the majority of the firm’s remaining attorneys are litigators. It is well regarded particularly for white-collar defense and media litigation, but the firm is more than capable of handling any general commercial litigation issues. Meanwhile the small transactional group is well versed in a variety of industries, including green tech and renewable energy, private equity, and entertainment.

Irell is ranked number thirty-seven overall by Vault. Despite the firm being limited in scope, it does extremely well in the areas it has chosen. It is ranked number two overall in IP litigation, and number seven overall in Intellectual Property. The firm has a regional rank of number four in Southern California.

Chambers and Partners ranks Irell either nationally or in California in Band 1 or 2 for the following practices: Bankruptcy, Intellectual Property, Litigation: White Collar Defense, Media & Entertainment Litigation, and Tax.

Employment

First and foremost, when looking to hire new associates, Irell is looking to hire brilliant people. For better or worse, that assessment is generally made simply by looking at the applicant’s grades. While some claim that personality is important, there is a vocal subset of Irell attorneys who openly admit that hiring is 95% about the grades of the applicant. At the very least, even if personality is important, it does not obviate the need for excellent academic credentials. At most schools where Irell interviews, there are fairly high, and fairly hard grade cut offs for applicants. Other traditional markers of achievement such as journal experience and moot court participation are considered as well.

The summer program at Irell is ten weeks long and only available in the main Los Angeles office. There are multiple ways that a summer associate can get work assigned to them. There are work coordinators who assign projects, but summer associates can also seek out their own assignments from attorneys. Further, associates are assigned to an “anchor case,” a single large case or transaction of which they will work on multiple aspects. Irell only expects summer associates to complete six to ten assignments over the course of the summer, significantly less than many peer firms. However the assignments are substantive work that actually matters to clients and the firm expects perfection. There is no room for error.

Summer associates are usually out of the office by 6:00, billing six or more hours a day. Weekend work is not common, but it does happen from time to time. In addition to unlimited attorney lunches, summer associates can also attend unlimited attorney dinners, budgeted at $25 and $85, respectively. Other social events include a trip to Disneyland and a party in Newport Beach. The firm holds an annual weekend retreat for summer associates on Catalina Island.

Despite the tumultuous economy, the firm still extended offers to 93% of its 2009 summer class. All incoming class of 2009 associates started on time in the fall.

Compensation and Benefits

Irell follows the standard lockstep system for associate salaries, starting at $160,000 for first year associates. The firm instituted no pay freezes during the downturn. Bonuses at Irell are also lockstep, as long as minimum billable hour totals are met. Bonus amounts at Irell are regularly above the “market rate,” usually double those set by Cravath, Sullivan & Cromwell, or whichever top firm is leading the way that year. The lockstep bonuses are a mixed blessing, as some associates feel they should be rewarded more for harder or better work, while others feel that the current system reduces pressure between associates.

Prior to 2010, associates had to bill 1,900 hours annually to qualify for a bonus. Beginning in 2010, the minimum total hours billed for bonus eligibility was increased to 2000. There is minimal face time pressure at Irell. Associates feel that they can do their work anywhere, as long as it gets done. Weekend work is common, but is almost always done from home. Further, the firm has no set vacation policy. Associates are free to take vacation days at their discretion, as long as client needs are being met and billable requirements are being achieved. In practice, associates take around three weeks of vacation each year, on par with associates at most other peer firms.

Benefits at Irell include a $500 technology budget (as the firm does not provide a BlackBerry by default), a $500 decorating budget, on-site gym, and free parking. Other benefits include regular happy hours and annual retreats. New associates receive a $15,000 stipend and relocation benefits, including $3,500 in moving expenses as well as bar exam course fees and expenses. Incoming judicial clerks receive a $50,000 bonus.

Partnership

Irell only has one level of partnership, and consequently a single partnership track. Eligibility generally takes a minimum of seven years before an associate will be considered. Selection for partnership requires some combination of hours, work ethic, client retention, and just being a very, very good attorney. Associates not promoted to partner may stay on with the firm. Becoming a partner at Irell is difficult in part because so few new partners are added each year. In 2010, the firm only added two new partners. This was actually an increase over 2009, when the firm added only one. With the firm seemingly content to stay restricted to Southern California, and showing no interest in pursuing expansion plans, there is no reason to believe this status quo will change any time soon.

Culture

In hiring, Irell focuses very heavily on grades first, and personality second. Because of this conscious choice by the firm, the population of the firm does not have any strong common themes among the attorneys. Though the firm did not seek out to create a culture of divergent personalities, it happened by accident. Accepting this as an unavoidable consequence of their hiring plan, the firm is very tolerant of various personalities, quirks, and lifestyles. Attorneys are free to be individuals, as long as they bring talent and skill to their work. Irell is very accepting of nonconformity, as long as you can do the work.

The downside of the firm as a collection of individuals is that there is no common thread tying them together, causing social interaction to suffer. While attorneys may tolerate each other’s quirks, in their free time most people would rather hang out with people more like them. This means intrafirm socialization can be as rare as at any stereotypical stodgy white shoe firm.